bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

helpersCheckIsPostiesArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

moreOnThisArticles

urlAlias

commentCount

sponsorType

authorLocations

authors

paywallTypes

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

socialHeadline

headline

flag

firstTopic

glossary

flattenTypeIds

publishedDate

additionalInfoBoxes

images

image

relatedLinks

relatedNewsletters

__typename

createdDate

sponsor

factSheets

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

copyrighted

customTimezone

liveContents

SCMP Reporter

Swire Pacific says attributable profit rose 18.5 per cent to $7.65 billion last year, boosted by three exceptional gains.

  The conglomerate's bottom line was given a $1.57 billion lift by the sale of 80 per cent of the J.W. Marriott hotel and stakes in Cathay Pacific Airways and Hong Kong Dragon Airlines.

  Underlying growth was more moderate.

   Excluding the exceptional gains, earnings were almost flat.

   If the hotel sale was included and considered as part of the company's core business, attributable profit growth was 10.4 per cent.

  Operating profit fell 23 per cent to $7.19 billion, largely because the sell-down of the Cathay stake meant the airline was now considered an associate rather than a subsidiary.

  For the same reason, Swire's turnover plummeted 28.5 per cent to $38.3 billion.

  Analysts said the results were marginally better than they had been expecting.

  According to The Estimate Directory, the consensus had been for an attributable profit rise of 14 per cent to $7.36 billion.

  Mark Simpson, head of research at ING Barings, said: 'It is a solid set of results, but not fantastic. 1996 was always going to be a difficult year.'   Swire's five main divisions, ranging from property investment to marine services, put in mixed performances.

  The property arm again was the largest contributor to earnings - recording a 12.7 per cent increase in attributable profit to $4.57 billion.

  Property earnings were helped by the $1.05 billion sale of the Marriott stake, and steady earnings at the group's portfolio of investment properties.

    Profits from the sale of properties declined as earnings of the joint-venture Island Place in North Point failed to match those of Robinson Place in 1995.

    The aviation division struggled at the operating level due to rising competition, higher fuel costs, and the continued weakening of the yen.

  The contribution was rescued by the two exceptionals, which enabled attributable profit to rise 24.4 per cent to $2.27 billion.

  The industries division, which includes Swire Beverages Coca-Cola operations, saw modest attributable profit growth of 1.9 per cent to $479 million.

  The trading division, which focuses on motor-vehicle distribution in Taiwan, suffered the greatest setback.

  Weak Taiwanese consumer demand saw the division's profit contribution slide 17.5 per cent to $164 million.

  Attributable profit at the marine services division rose to $387 million from $311 million.

  Discussing the company's prospects, chairman Peter Sutch said he expected the contribution from residential property sales to rise significantly this year. He also said the company was seeking to expand its land bank aggressively.

  Although no deals had been concluded, the company 'had a number of irons in the fire'.

  Swire's results seemed to find some approval with the market.

   The price of its shares retraced some of the morning losses after the results were released.

  Despite gaining 1.6 per cent in the afternoon, the shares still finished the day $1.25 down, at $61.50.

  Discussing the poor performance of the group's shares - 16.61 per cent down this year - finance director Peter Johansen said: 'It is difficult to pin this one down.

  'Our view is that the slightly lacklustre performance in our share price is not deserved.' 



Exceptionals lift Swire to $7.65b